SRP has a better solar-fee idea

Our View: At first blush, SRP's proposal looks similar to APS's ill-fated net-metering idea. But it's much more responsible.

Jeff LaBelle with One Way Solar Systems rinses off a biodegradable soap he uses to clean the solar array atop a Peoria resident's home in 2010. Traditional utility companies have proposed rate increases on homeowners with rooftop-solar arrays to combat increased financial challenges.(Photo11: Charlie Leight/The Republic)

All around the country — scratch that — all around the world, traditional utility companies face financial challenges in a fast-changing energy world.

Their competition? As always when industries evolve, it is the emergence of a new competitor.

But for utilities, it is not the emergence of one or two new competitors, but thousands of them.

With rooftop-solar arrays proliferating, especially in Sun Belt states like Arizona, traditional utility companies face a bleak financial future without making serious changes to their pricing structure.

Utilities buy back unused rooftop-solar power and distribute it to other customers. In a world in which a handful of rooftop-solar owners sold back their power, the utility's costs were negligible.

But as rooftop continues to grow in popularity, utilities say those customers are not bearing their fair share of maintaining the grid that provides them power when the sun goes down.

A University of California study released this fall predicts the typical Southwestern utility company will start losing revenue seriously once about 2.5 percent of its customers have gone solar. In sunny Arizona, that day is fast approaching.

As a result, the Valley's two biggest utilities, Arizona Public Service and Salt River Project, proposed rate increases on homeowners with rooftop-solar arrays.

The proposal by APS, basically a fixed fee of between $50 and $100, was rejected last year by the state Corporation Commission. Instead, the regulators allowed APS to assess a fee of $5, on average, per solar customer.

Now comes SRP's proposal to raise rates on new rooftop-solar users by an average of $50, but with a key difference. Rather than simply dun rooftop-solar owners with a big new fee, the utility would give those customers a way to minimize the increase by reducing the amount of peak-demand power they take from the grid.

They can do this by orienting solar panels to the west, rather than the south, by using load-limiters that keep energy hogs from coming on during peak times, or by storing solar-produced power in batteries as that technology improves.

That is a more responsible approach than the one proposed by APS and rejected by the Corporation Commission.

Until power-storage innovations allow homeowners to decouple entirely from the grid, rooftop-solar customers still must rely on it with the rest of us. They should share in the costs of maintaining it.

The SRP proposal appears to equalize that cost-sharing burden while encouraging solar-generating customers to reduce their part of the maintenance tab by altering their behavior.

The public will have several months, and plenty of opportunities, to debate SRP's proposal or suggest other approaches before a scheduled Feb. 26 vote by SRP's elected board of directors.

Claims that SRP's proposed rates would doom the solar industry are specious, certainly at this early point. The utility just signed a 21-year deal to buy solar-generated power from the 45-megawatt Sandstone Solar Power Plant near Florence.

The future of solar, including rooftop solar, is not damaged by a fair spread of costs to maintain the grid. The energy world may be changing quickly, but as long as the new ways remain tethered to the old ways, everyone still must share those costs.